To The Moon

One of the things you develop after a few decades of investing is battle scars and a historical view of where we are today.

History never repeats, but it often rhymes.

As we’ve watched some of the absolutely crazy stock performance in 2026, I think it’s important to give some of that historical context to some parts of the market. I don’t know how this all ends, but I know how it’s ended before. I’ve seen these growth numbers. I’ve felt the investor confidence. And I’ve learned lessons along the way.

The Market’s Rocket Ships

Today, the market is bidding up all stocks related to AI, semiconductors, rockets, and dreams. Some of the stocks rising rapidly are seeing outstanding earnings, and we could debate if those are sustainable or not, but others are spending money at a growing clip to fuel growth.

What we don’t know about any of these companies is what the future return on all of this investment looks like. But the data we have right now isn’t good.

Look at $NEBIUS(NBIS)$ ( ▲ 2.1% ):

and $AST SpaceMobile, Inc.(ASTS)$ ( ▼ 14.79% ):

and $Rocket Lab USA, Inc.(RKLB)$ ( ▼ 3.07% ):

The market has gone crazy with money-losing companies that are selling dreams of a brighter future.

To be fair, some of these businesses will be big (like rockets), but will they be profitable? Will they be profitable enough to justify current valuations?

That’s less clear.

Historically, unprofitable companies don’t 10x in value and hold it. Here’s a list of companies that have 10x’d in value, or more, over the last 10 years, and their free cash flow margin. Notice…it’s positive.

Think I’m cherry-picking big companies? Here’s the list further down. The only outlier is Nebius, which has had its 10x gains in the past few months.

So, what’s the historical context for these rocket stocks in popular, money-losing businesses?

We’ve Been Here Before

The two most vivid memories I have of moments like this were in 2014, during the rare earth and hydrogen boom days, and the solar boom shortly after.

If you don’t remember, 2014 was originally when EVs were going to take over the world, and hydrogen was going to power everything from trucks to power grids.

$Plug Power(PLUG)$ was the quintessential example of this particular phase of euphoria. The stock was an absolute rocket ship in early 2014.

The business? Not so much! But point that out online (where I was writing for The Motley Fool), and you would be eviscerated.

But the simple facts were that Plug Power — despite impressive growth — had no history of being able to generate positive gross margin, much less free cash flow.

Management signed big contracts with companies like Walmart and Amazon, which the market saw as a sign the turnaround was coming. Management made promises about profitability soon, which I highlighted in this 2017 article, but they never became a reality.

Over the next five years, Plug Power would continue to grow and even went through a meme phase during the pandemic, but more than a decade later the business is worse than ever.

Buying promises without seeing evidence that the promises are real is not a risk I’m ready to take.

$SUNation Energy Inc(SUNE)$ is probably more analogous to the moment we’re currently in.

The business model for SunEdison reminds me a lot of the companies building AI today. Companies like Nebius, Iren, and Coreweave are hot as can be, just like SunEdison was in 2014. They’re announcing massive new deals and massive backlogs (SunEdison’s backlog was decades).

And then…

What happened?

The market lost confidence.

It became more expensive to issue the next round of debt and the next phase of equity.

And if you don’t have a positive cash flow business to fund future growth, market confidence is the one thing that keeps you afloat. Lose that, and it’s over.

Hits and Misses

Why have I missed this particular boom in the stock market in 2026?

I don’t see a lot of the euphoric stocks as sustainable.

They don’t have business models that have proven to have pricing power, a durable moat, or even the ability to generate free cash flow.

I know the backlog numbers are impressive, and the companies they’re signing deals with are huge. But the same was said about Plug Power and SunEdison.

One of the hardest things about investing is not having FOMO when it seems like everyone else is making money. Right now, everyone is making money on stocks like these, and I’m not.

But I’ve been here before, and I often remind myself that we’ve seen this story before, and it didn’t end well. That’s why I’m not playing this time, for better or wore.

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